Follow the Money

Purchasing a Bamboosero bicycle generates reliable income for the builders. For the umbrella Bamboosero organization, fees and profits fund the creation of new Bamboosero networks. These monies cover extensive training associated with a steep learning curve and the development of previously non-existent infrastructure. Bamboosero operates in remote areas introducing micro-manufacturing – a crucial first step towards generating economic growth. The rest of the costs and expenses are typical for the bicycle industry.

Pricing Structure

Category

Description

Margin

Cost

Cost per frame (COGS)

See detailed COGS breakdown below

$109.40

Gross Profit

Direct to builder – can be used for capital investment in their business

27%

$40.60

Price paid to builder

Subtotal

$150.00

In country transportation

Expense to cover transportation from production site to inspection center

$25.00

Quality Assurance Inspection

Inspection fee covers production oversight ensuring all aspects of frame are to specification and prepared for end user

$25.00

Painting

Cost of materials and labor for two part UV protectant clear coat

$35.00

International Shipping

Bulk shipments to reduce expense – subject to going rate for locality

$50.00

Distributor’s Landed Cost

Subtotal

$285.00

Distributor Margin

Fee to distributor for importing and distributing product to wholesale and retail customers

18%

$72.00

Licensing fee (Bamboosero)

Fee collected by Bamboosero to reinvest in brand’s quality reputation and for manufacturing expansion.

12%

$50.00

Re-work Frame

Reworking of frame once arrived-Alignment/Cracks/Paint

Est:

$133.00

Wholesale price

Total

$540.00

Retail Margin

Standard margin for bicycle industry retail businesses to service the end user

40%

$360.00

Retail Price (Frame Only)

Total (not including tax)

$900.00

Example of COGS using historical costs in Ghana

Cost of Goods Sold

Locally Sourced

Cost

Labor *

$60.00

Bamboo

$2.00

Fiber

$1.00

Lacquer

$0.75

Subtotal Loc. Sourced

$63.75

Supplied by Bamboosero

Cost

Treatment chemical

$3.00

Epoxy (fast and slow curing)

$20.00

Dropouts

$13.00

Head tube

$1.00

Bottom bracket shell

$2.00

Seat tube insert

$2.00

Brake bridge / other

$1.00

Subtotal Supplied

$42.00

Total Cost of Goods Sold

$105.75

Expenses (per frame)

Cost

Gloves (reusable, 2 frames / pr.)

$0.25

Release wax

$0.10

Vinegar

$0.10

Lacquer Thinner

$0.25

Brushes

$0.10

Sandpaper (80, 120 and 220 grit)

$1.50

Electrical Tape (2 rolls)

$1.00

Markers

$0.10

Newspaper / Rags

$0.25

Total Expenses

$3.65

Total Direct Cost Per Frame

$109.40

*Bamboosero income on per person basis is comparable to what a tradesperson would earn in the same location. Bamboosero differs in that it aims to provide steadier employment than a rural-based tradesperson could otherwise count on.